P/E Ratio (Price-to-Earnings)
InvestingA valuation metric comparing a stock's price to its earnings per share, indicating how much investors pay per dollar of earnings.
Example
Example: Consider an investor building a $100,000 portfolio. P/E Ratio (Price-to-Earnings) — a valuation metric comparing a stock's price to its earnings per share, indicating — directly affects investment strategy and long-term returns. Getting this concept right can mean tens of thousands of dollars in difference over a 20-year period. Model your portfolio with our investment calculator.